Social funds warn Web firms on human rights

A group of social investment funds from Western countries on Monday called for Internet companies to refrain from supporting repressive human rights practices in China and other nations.

In a letter by 25 investment funds based in the United States, Switzerland, Canada and Australia that manage a total of $21 billion in investments, fund managers warned companies ranging from Yahoo to Cisco of the risks in "collaborating to suppress freedom of opinion and expression."

The investor group said it was responding to a recent controversy over the role allegedly played by Yahoo's Hong Kong unit in providing evidence that human rights campaigners say led to the imprisonment of a dissident Chinese journalist.

In September, Paris-based Reporters Without Borders charged that Yahoo helped Chinese authorities to link journalist Shi Tao to a U.S.-based Web site, leading him to receive a 10-year prison sentence for revealing state secrets in April.

"We take this issue very seriously," Yahoo spokeswoman Mary Osako said in a statement on Monday.

"While foreign-based companies must adhere to local laws in all the countries where they operate, we understand that there are unique and inherent challenges to doing business in China," the Yahoo spokeswoman added.

Signatories to the letter included Domini, Calvert Group, Walden Asset Management, various U.S. Catholic social investment funds, Ethical Funds Co. of Canada, Fondation Ethos in Switzerland and Conscious Investors Pty Ltd. of Australia.

"This is essentially a lockdown on freedom of expression," Amy Domini, founder and CEO of Domini Social Investments LLC of New York and a leading U.S. social investment campaigner, said in a phone interview.

Domini decried what she said were violations of basic notions of privacy rights, arguing that Internet access should be free from government snooping just as private mail or conversations in cafes. "The Internet is now the way people chat with each other," she said.

Other companies singled out at a joint news conference in New York held by investment groups and Reporters Without Borders included Google Inc. and Microsoft Corp..

No one from Google, Microsoft or Cisco Systems was immediately available to comment.

The letter called on Internet businesses "to make information public that will allow investors to assess how each firm is acting to ensure that its products and services are not being used to commit human rights violations."

The group also plans to target companies that distribute products or services that enable Internet censorship, surveillance or identification of dissidents.

Leading global makers of communications network gear such as Cisco and Nortel have long faced criticism for their role in supplying technologies that allow the Chinese government to maintain tight censorship controls over the domestic Internet.

Reporters Without Borders said the scope of the campaign for free Internet expression extends beyond China to include companies such as Fortinet, which it said installed filters on the Internet for Burma's military government, or Secure Computing Corp., whose filtering technology is used in Tunisia.

"Some businesses help authorities in repressive countries to censor and mount surveillance of the Internet, and others turn a blind eye to the use made of their equipment," the investment fund letter states.

Sunnyvale, California-based Yahoo seeks to balance legal requirements against its belief that the company can contribute to the country's modernization of communications, commerce and information access, Yahoo spokeswoman Osaka said.